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DC Agency - michelle bingham 2010-07-27 11:51:29
 
I have received a letter from a debt collection agency saying I owe £1551 from a very old credit card (can't really remember but think is a good few years old). They say I am in court on Friday but if I pay the whole amount I won't have to go. Are they bluffing? Can I ask for proof of this debt? They say as they have written to me several times (though I have not seen the letters as I have moved a couple of times in the last few years) they are in their rights to take me to court on Friday. Should I have a anything from the court?
Thanks!
Very worried mum of two!

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Re:DC Agency - simon wiggins 2010-07-28 11:30:45
 
Hello Michele. I'm sorry to hear about your concerns and so will do my best to explain the recovery process for you so that you can make your own mind up on this one.

Once a person defaults on their credit agreement of whatever sort at some point after a few missed payments if the arrears are not dealt with by agreement or brought up to date again by the debtor then a formal default notice will be issued by the creditor This details what’s wrong, how to put it right and gives the person a set period to do so. If they don’t then the account is passed into that creditors normal recovery cycle which will include a variable number or debt collection agents solicitors firms and tracing agents each of whom get the account for a set period of time usually 2 to 3 months each.

During that time the agent will contact the debtor by phone and letter with ever urgency implied seriousness attempting to either get the debt repaid in full or a repayment plan set up to do so. Remember they don’t get paid if they don’t succeed. At the end of each set period the account is simply passed along to the next agency in the chain to have ago and the cycle repeats itself. These cycles last at their fastest about 9 months working up to over 5 years for the longest. Your account is somewhere in this process and each agent will do their utmost to get you to pay.

At the end of the cycle the account is passed back to the creditor for them to decide what to do next. They could sell the debt on to a 3rd party, write it off or take court action and of course most take legal action. When this occurs is variable and cant be predicted as each creditor has their own unique recovery cycle though. When the instigate court action the court dealing with the matter will send the claim form and associated paperwork to the debtors home address for them to respond to. In a situation such as yours you would reply on the enclosed paperwork telling the court about your current financial position making an offer of payment you can afford however low that may be even if its only £1 per month. If the creditor accepts this offer then a court order will simple arrive telling you to start monthly payments on a set date. If not then it goes to a hearing where a district judge decides how much you can afford to pay and males the appropriate instalment order They will never make an order you cant afford to pay whatever the creditor may insist they must have. I have a client repaying a 19K at £1.27P per month as that’s all they can afford when the creditor wanted over £500 PCm so don’t worry about this process if it occurs as it there to protect you as well as get the debt repaid eventually.

So remembering that some agencies may bluff or sail close to the wind as far as the OFT's debt collection guidance goes have you had a court summons. If not there is no hearing as the process has not even started and they are trying to scare you into paying. If they have said its in court on Friday ask what court and ring them. If they wont tell you that’s probably because it’s not in fact true.

The next point is you say it’s from a long time ago. The statute of limitations sets periods by which creditors must obtain a court order or they lose the right to d so forever which is known as becoming statute barred Once this occurs they can only ask you to repay such a debt but no longer force you to do so by legal means So the question is is this debt statute barred already and if it is they cant make you pay a penny or take court action.

You can argue that the creditor is out of time or 'statute barred' from taking you to court for a non land related debt if the creditor has not already obtained a judgment against you and you or anyone else owing the money (if your debt is in joint names) have not made a payment on the debt during the last six years and you have not written to the creditor admitting you owe the debt during the last six years.
All that changes though Michele is that you can’t be pursued any longer via the courts. You’re still just as liable as the day you took the said debt on and can be pursued for it they can use every tactic save court action to get you to pay up.

So I hope this answers your query re the "court action on Friday" and you will take the time to read the information I have sent you in these subjects via e-mail. I suspect this is nothing but a bluff but only you can decide if the debt is statute barred or not. I hope this helps and by all means come back to me again if I can be of any further help. Best wishes

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